Singapore’s inflation rate has risen at its slowest pace since February 2021, reaching 2.1% year-on-year in January 2025. This marks a significant drop from December 2024’s 3.4%, offering a glimmer of hope for economic stabilization. The Monetary Authority of Singapore (MAS) attributes the slowdown to a stronger Singapore dollar, which has reduced import costs, and improved global supply chain conditions.

Economists believe the easing inflation could provide the central bank with more flexibility to support economic growth. Lower inflation rates may also ease the financial burden on households and businesses, fostering a more favorable environment for investment and consumption. However, experts warn that external risks, such as geopolitical tensions and fluctuating commodity prices, could still disrupt this positive trend.

Prime Minister Lee Hsien Loong emphasized the government’s commitment to maintaining affordability for citizens. “While we are encouraged by the slowdown in inflation, we will continue to monitor the situation closely and take necessary steps to safeguard our economy,” he said.